JAKARTA — In a conference room of the national police headquarters
here, Patsy Spier last week once again relived the attack that robbed her
of her husband on a Saturday afternoon in 2002 in remote Papua Province.

In more than six hours of questioning by Indonesian police
investigators, she described how attackers fired into the convoy carrying
her, her husband and eight other Americans up a mountain road inside the
concession of Freeport-McMoRan, an American mining company.

"I emphasized that whoever carried this out knew what they were
doing," Mrs. Spier said in an interview last week, when she returned
to Jakarta at the time of a breakthrough in the case with the detention of
eight suspects. "It wasn't just a few minutes, it wasn't just a gun
getting away, it was repeated shots. They were going to kill someone that
day."

The ambush killed her husband, Rickey Lynn Spier, another American
teacher, Edwin Burgon, and an Indonesian teacher, Bambang Riwanto, and
snarled efforts by the Bush administration to strengthen military
relations with Indonesia. It also raised questions about payments by
Freeport, based in New Orleans, to the Indonesian Army, which patrolled
the road, and whose soldiers are suspected of involvement.

Not least, the case placed Mrs. Spier, who will turn 48 Monday, at the
center of strained United States relations with Indonesia over the
incident, making her an accidental ambassador for justice on a nearly
four-year quest to untangle who was behind the killings.

In Washington, Mrs. Spier's mettle — she has made 17 trips from her
home in Colorado — won her access to high officials, including John D.
Ashcroft, during his tenure as attorney general. In Jakarta last week,
Mrs. Spier, a former Peace Corps volunteer in Sierra Leone who later
traveled the world teaching with her husband, met with the Indonesian
president, Susilo Bambang Yudhoyono, their second encounter.

Widows with horrific stories of violence abroad are not unusual in
Washington. But Mrs. Spier has struck a chord. She said she tracked down
every lead to seek a full investigation of the case, which at times seemed
at risk of dying, amid resistance by the Indonesian government to the
F.B.I.

Even today, the pursuit of the connections the case might have with
Indonesia's military is likely to clash with the warming of military ties
between the Bush administration and Indonesia in the last 18 months.

"If Patsy hadn't stuck with it, I'm not at all sure we'd be where
we are today," Matthew P. Daley, a former deputy assistant secretary
of state and one of the first people she called on, said last week.

This month, the F.B.I. arranged for the surrender in Papua of 12 men in
the killings, including Anthonius Wamang, a member of a Papuan separatist
group, who was indicted by a federal grand jury in Washington in June
2004.

Four of the men were freed, and the others are in custody in Jakarta.

Those in custody are expected to be charged, lawyers in the case said.

One of the suspects is 14, another 15, a list provided by a Papuan
human rights group says. All are supporters of the Papuan separatist
movement, a police investigator said.

The arrests and the promise by the Indonesians of a fair trial still
leave unanswered who planned the attacks, what the motives were and
whether Indonesian soldiers were involved, Mrs. Spier said. To get those
answers, she said she had asked President Yudhoyono to allow the F.B.I. to
continue in the case and to question the suspects to ensure "a
credible investigation." The president "gave his
commitment," she said, although the national police chief, Gen.
Sutanto, said last week that the F.B.I.'s role was over.

"The police involved in the investigation still believe the
military was involved," said an Indonesian investigator who gave The
New York Times official transcripts of witness interviews. "But this
involves relations between two countries. It will be difficult for the
police to dare to say the military was involved."

The evidence of military involvement is largely circumstantial. Mr.

Wamang was close to Indonesian military units in Papua, and was paid by
the military for trips to Jakarta, the police investigator said.

After his capture, Mr. Wamang told the police he got the bullets from a
senior Indonesian soldier, his lawyer, Albert Rumbekwan, said. The F.B.I.
said in a report to a Congressional panel that the assailants had used the
same type of automatic rifles used by Indonesia's military.

The ambush occurred between military checkpoints that are only five
miles apart. The road falls away at almost an 80-degree angle into a
mountainous valley, making it almost impossible for the attackers to have
gotten into position without the acquiescence of soldiers on the road, the
Indonesian police investigator said, a conclusion shared by Mrs. Spier and
American investigators.

The soldiers on the road did not respond to the attack for more than 30
minutes, according to Mrs. Spier and the F.B.I. investigation.

Soldiers came to the rescue after a Freeport executive, Andrew J. Neale,
stumbled across the shooting as he was driving down the road and went to
the military post for help. He said he had heard "continuous
shooting," an official transcript of his questioning by Indonesian
police says.

The ambush angered Congress and delayed the renewal of American money
for military training for Indonesia for more than two years.

But over the objections of some members of Congress, the Bush
administration resumed the training in February 2005 after the indictment
of Mr. Wamang. The training had been suspended in 1992 after Indonesian
security forces massacred civilians in East Timor in 1991.

In November, the administration waived curbs on lethal arms sales,
saying that Indonesia was "a voice of moderation in the Islamic
world" and that the F.B.I. had received renewed cooperation in the
case.

The preliminary Indonesian police report suggested that a motivation
for the attack was a threat by Freeport, which runs the world's largest
gold mine in Papua, to cut its payments to Indonesian soldiers. Freeport
was giving Indonesian military officers such benefits as nights at the
Sheraton hotel, airline tickets and cash, company documents provided to
The New York Times show.

In 1998 through 2004, the company gave individual officers and units
more than $20 million in cash and benefits, the documents show.

Mr. Spier, the two other teachers who were killed and Mrs. Spier, who
was shot in the rib and suffered shrapnel wounds to her back and a kidney,
worked at the school run by Freeport for the children of its employees. If
the shootings were motivated by the soldiers' wanting more money from
Freeport, Mrs. Spier said, she would seek to change laws on corporate
behavior abroad.

"If the Foreign Corrupt Practices Act needs to be changed, I want
to change it," she said.

She said she expected to attend the trial in Jakarta, though a date is
uncertain. If convicted, the suspects could face the death penalty.

"There's a death penalty here," she said. "They knew
what they were doing. They chose to kill. The consequences are
there."

----

The Korea Herald/ANN January 28, 2006

Korea offers to sell subs to Indonesia

SEOUL: The South Korean government officially offered to sell
domestically built submarines to Indonesia during talks between the two
nation's defense ministers in Jakarta earlier this week, The Korea Herald
quoted on Saturdaya military official.

JAKARTA, Indonesia, Jan. 27 — The New York City comptroller has charged
that the American mining company Freeport-McMoRan knowingly made "false or
misleading" statements about payments to the Indonesian military, and has
asked the Securities and Exchange Commission and the Justice Department to
investigate.

In separate letters to each agency, the comptroller, William C. Thompson
Jr., who is the investment adviser to the city's five pension funds, said
that he believed the company might have violated the Foreign Corrupt
Practices Act, which forbids American companies to bribe foreign officials.

He also told the securities commission that Freeport-McMoRan Copper and
Gold, which is based in New Orleans, might have filed false proxy statements
in violation of the Securities Exchange Act.

Mr. Thompson said in the letters, dated Thursday, that he was asking for
the investigations based on a report by The New York Times in December,
which he said showed that Freeport had paid "large sums of money directly
into the personal bank accounts of a number of individual Indonesian Army
officers."

Mr. Thompson's request came amid several other calls for investigations
into Freeport's payments, including from Sen. Joseph R. Biden Jr., the
ranking Democrat on the Foreign Relations Committee, who has long been
concerned with corruption in the Indonesian military and its poor human
rights record.

Freeport documents obtained by The Times show that from 1998 through 2004
Freeport paid nearly $20 million to individual military and police officers
and units in remote Papua Province, where Freeport runs the world's largest
gold mine.

More than two dozen commanders, most of them from the army and the
police, but also from the navy and the air force, received payments,
according to the documents. Some officers were given monthly payments. Some
amounted to over $100,000 in a year in a country where a general's annual
salary is less than $10,000.

Freeport says the payments were "ordinary business activities" and were
within American and Indonesian laws. "The support and assistance for the
military and police in Papua includes mitigating living costs and hardship
elements of posting in Papua, better ensuring that legitimate security needs
are provided to the company," it said in a written response to questions
from The Times in December.

The New York City pension funds have in the past challenged Freeport's
payments. Mr. Thompson wrote that after the funds filed shareholder
resolutions in 2004 and 2005 calling for the company to cease the payments,
Freeport told the S.E.C. that the payments were made to the Indonesian
government as reimbursement for security services.

In contending the money went to the government and not to individual
officers, "the statements amount to a knowingly misleading representation by
Freeport," the comptroller said.

In a telephone interview from New York on Friday, Mr. Thompson said, "We
had filed shareholder resolutions over the last three years, trying to get
the company to account for their actions in payments to the military." In
response, he said, the company "tried to prevent us from moving forward with
our resolutions."

In his letter to Attorney General Alberto Gonzales, Mr. Thompson said the
funds were asking the department "to undertake a formal review to determine
if" Freeport had violated the Foreign Corrupt Practices Act.

The funds, one of the largest public pension systems in the United
States, own 590,350 shares of Freeport stock — currently worth $37 million —
and the funds s were concerned that "possible illegal actions by company
officials could have a negative impact on shareholder value," Mr. Thompson
wrote.

Asked about the comptroller's letters, Stanley S. Arkin, a lawyer for
Freeport, said that the company had nothing to add to what it had already
said in its public disclosures. "Our public findings are what our public
findings are," he said. "We do not comment on such things."

After the December article, the company posted a letter on its Web site
saying the article and a subsequent editorial contained "disturbing and
provocative misstatements" about its operations and that the article had
"ignored the practicalities of conducting business in a remote area."

The company acknowledged in a conference call with investors two weeks
ago that it was under federal scrutiny regarding payments to the military.
Executives said they were "fully cooperating" with "informal inquiries from
government agencies."

In a statement Friday in Washington, Senator Biden said investigations of
the company were needed. "Large payments by Freeport officials directly to
individual Indonesian Army officers are highly irregular," Mr. Biden said.
"It is time for the Justice Department and the Congress thoroughly to
investigate Freeport's business practices in Indonesia."

Mr. Biden said Freeport's conduct threatened to undermine the efforts of
the Indonesian president, Susilo Bambang Yudhoyono, who is considered a
reformer, to clean up the army.

In Indonesia, Juwono Sudarsono, the civilian defense minister, told the
Dow Jones news service that he had asked the inspector general of the
defense forces to look into the payments. It was illegal, he said, under
Indonesian law for foreign companies to pay soldiers.

A leading Indonesian politician and former presidential candidate, Amien
Rais, in speeches and interviews with reporters, has called for Parliament
to change Freeport's contract so that the Indonesian government receives
what he called a more equal share of the mine's profits.

With gold prices recently surging to a 25-year high of more than $550 an
ounce, Freeport said that its profits had more than doubled last quarter and
that it would pay the Indonesian government some $1 billion in taxes for
2005.

At the same time, by Freeport's own estimates, its mining operations will
generate some six billion tons of waste in Papua before they are through,
much of it dumped directly into what was once a pristine river system. Its
waste disposal method, the company says, has been approved by provincial
authorities.

"I saw where they had demolished a mountain forever, and instead left an
ugly lake," Mr. Rais said in an interview of a visit he made to the mine. "I
felt humiliated as a son of Indonesia."

In Parliament, members of two separate committees said they would ask
Freeport executives to answer questions about the company's payments to the
military, its tax payments and the environmental damage around the mine
site.

A member of the environment committee, Alvin Lie, said his panel would
hold hearings in February to look at the environmental consequences of the
gold mine on one of the world's most diverse ecosystems.

A member of the finance committee, Drajad Wibowo, who holds a Ph.D. in
economics from an Australian university and was instrumental in uncovering a
major Indonesian banking scandal, said he would ask the Ministry of Finance
to explain to the panel Freeport's tax and royalty payments.

He suspected, he said, that Freeport was not paying enough taxes. "When a
mining company works in its own country it works under very transparent
rules," Mr. Drajad said. "Here it is in secret."